EXCLUSIVE: Colorado Dems fast-track health insurance premium hike on citizens to fund coverage for illegal aliens

Colorado Democrats are racing to pass SB 26-178 before the legislature adjourns on May 13 — a bill that would impose a new $40 million assessment on health insurance plans operating in the state, with a significant share flowing to a program that subsidizes coverage for non-citizens, including those in the country illegally.

The bill cleared its first Senate committee on April 28 and is on track for full Senate passage as soon as next week, sources tracking the legislation tell Washington Reporter. House passage could follow the week after.

The fees would be assessed on insurance carriers via the Health Insurance Affordability Enterprise (HIAE), an enterprise fund created in 2020. While billed as an affordability measure, the fees are paid by carriers and routinely passed through to policyholders. Industry analysis of last year’s similar legislation projected costs of up to $1,200 per year for a family of four — and could affect upwards of one million Coloradans on employer or individual plans, even though most see no direct benefit from HIAE programs.

A substantial portion of the new revenue would underwrite OmniSalud, which provides subsidized health coverage to undocumented immigrants. Colorado’s HIAE statute defines a “qualified individual” eligible for subsidies as “an individual, regardless of immigration status.”

Republicans have opposed the underlying program. “We want to be a society that has a heart but, when you have the citizens and taxpayers here that are suffering and we’re not taking care of them but, we’re going to help take care of somebody who came here illegally, I have a problem with that,” state Rep. Anthony Hartsook (R-Parker) told CBS Colorado of an earlier version of the legislation.

A Republican operative told the Washington Reporter, “Even though Colorado has become a blue state, this type of overreach will have massive backlash. No one wants to pay higher premiums so illegal aliens can get taxpayer-subsidized healthcare.”

Democrats argue the assessment is necessary to backfill federal subsidies that expired at the end of 2025, with state regulators warning that average individual-market premiums could otherwise rise by as much as 28 percent.

The bill could reach Gov. Jared Polis’s desk before adjournment.